Head-To-Head Review: TFS Financial (NASDAQ:TFSL) and Security Bancorp (OTCMKTS:SCYT)

TFS Financial (NASDAQ:TFSL) and Security Bancorp (OTCMKTS:SCYT) are both finance companies, but which is the superior business? We will compare the two businesses based on the strength of their analyst recommendations, earnings, institutional ownership, profitability, dividends, valuation and risk.

Institutional and Insider Ownership

9.8% of TFS Financial shares are owned by institutional investors. 0.7% of TFS Financial shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Risk & Volatility

TFS Financial has a beta of 0.72, indicating that its share price is 28% less volatile than the S&P 500. Comparatively, Security Bancorp has a beta of 0.05, indicating that its share price is 95% less volatile than the S&P 500.

Valuation and Earnings

This table compares TFS Financial and Security Bancorp”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
TFS Financial	$336.50 million	14.48	$90.96 million	$0.33	52.67
Security Bancorp	$24.35 million	1.75	$5.49 million	$15.41	7.27

TFS Financial has higher revenue and earnings than Security Bancorp. Security Bancorp is trading at a lower price-to-earnings ratio than TFS Financial, indicating that it is currently the more affordable of the two stocks.

Dividends

TFS Financial pays an annual dividend of $1.13 per share and has a dividend yield of 6.5%. Security Bancorp pays an annual dividend of $1.00 per share and has a dividend yield of 0.9%. TFS Financial pays out 342.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Security Bancorp pays out 6.5% of its earnings in the form of a dividend.

Profitability

This table compares TFS Financial and Security Bancorp’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
TFS Financial	11.42%	4.89%	0.53%
Security Bancorp	24.05%	N/A	N/A

Analyst Ratings

This is a breakdown of recent ratings and recommmendations for TFS Financial and Security Bancorp, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
TFS Financial	0	3	1	0	2.25
Security Bancorp	0	0	0	0	0.00

TFS Financial currently has a consensus target price of $15.50, suggesting a potential downside of 10.82%. Given TFS Financial’s stronger consensus rating and higher possible upside, research analysts clearly believe TFS Financial is more favorable than Security Bancorp.

Summary

TFS Financial beats Security Bancorp on 13 of the 16 factors compared between the two stocks.

About TFS Financial

TFS Financial Corporation, through its subsidiaries, provides retail consumer banking services in the United States. Its deposit products include savings, money market, checking, individual retirement, and other qualified plan accounts, as well as certificates of deposit. The company also provides residential real estate mortgage loans, residential construction loans, and home equity loans and lines of credit, as well as purchase mortgages and first mortgage refinance loans. In addition, it offers escrow and settlement services. The company provides its products and services through its main office in Cleveland, Ohio; and multiple full-service branches and loan production offices located throughout the states of Ohio and Florida. TFS Financial Corporation was founded in 1938 and is headquartered in Cleveland, Ohio. TFS Financial Corporation is a subsidiary of Third Federal Savings and Loan Association of Cleveland, MHC.

About Security Bancorp

Security Bancorp, Inc. operates as the bank holding company for Security Federal Savings Bank that provides banking products and services to individual and corporate customers in Tennessee. The company's deposit products include checking and savings accounts, and certificates of deposit. It also offers consumer loans; mortgage loans; and commercial loans, including installment loans, lines of credit, and real estate lending. In addition, the company provides financial services, as well as online, mobile, and telephone banking services. Security Bancorp, Inc. was founded in 1960 and is headquartered in McMinnville, Tennessee.